TOPICAL capsaicin causes hair loss by activating the TRPV1 receptors in the hair follicle, which cause the hair to enter the catagen phase.

ORAL capsaicin causes hair growth because it is a selective antagonist of the cannaboid-1 receptor internally. The CB-1 receptor is activated not only be cannabis but by stress, and it's crucial in regulating hair growth--specifically, it inhibits it, which is why potheads have gross hair. This means that oral ORAL capsaicin is good especially for people who are losing hair partly due to stress but should help most people grow hair longer/better.